Friday, September 22, 2017

Over 2 billion trade deficit daily

The country witnessed trade deficit of over Rs 2 billion every day.
According to the central bank, the country has witnessed a total of Rs 70.60 billion trade deficit in the first month of the current fiscal year – mid-July to mid-August.
It is an increase of 10.1 per cent against the same period of last fiscal year,' the central bank report revealed, adding that the growth rate of trade deficit, however, has contracted when compared to growth rate of 13.6 per cent in the first month of last fiscal year.
Merchandise imports increased by 9.3 per cent to Rs 77.28 billion in the review period compared to a growth of 13 per cent in the same period of the previous fiscal year, whereas exports decreased by 3.9 per cent to Rs 6.68 billion against growth of 7.7 per cent in the same period of the previous fiscal year.
The report also revealed that imports from India rose by nine per cent whereas imports from China and other countries went up by 14.2 per cent and 7.1 per cent, respectively. "In the first month, import of petroleum products, gold, cement, hot rolled sheet in coil, aircraft spare parts, among others increased, whereas import of edible oil, machinery and parts, electrical goods and equipment, cold rolled sheet in coil and agricultural equipment, among others, decreased."
Merchandise export to India dropped in the first month by 10.1 per cent to stand at Rs 3.44 billion against Rs 3.82 billion in the same period of the last fiscal year. "Drop in export of commodities like raw jute, soap and mustard and linseed contributed to the decline in exports to India, while, export of these commodities declined by 100 per cent," according to the current Macroeconomic Situation. "However, export of hessian and particleboards increased by 305 per cent and 298 per cent, respectively in review period."
Likewise, exports to China and other countries increased by 11.3 per cent and 3.2 per cent, respectively in the first month of the current fiscal year. Commodity-wise, export of zinc sheet, thread, readymade garments and oil cake, among others, increased whereas the export of woollen carpets, polyester yarn, toothpaste and cardamom, among others, decreased.
Workers’ remittances inflow growth also increased by seven per cent to Rs 55.55 billion in contrast to a decline by 2.5 per cent in the same period of the previous fiscal year. However, outflow of migrant workers fell by 11.8 per cent following a decline of 6.9 per cent in same period of last fiscal year.
Consequently, net transfer receipt went up by 4.9 per cent to Rs 62.70 billion. Such receipt had fallen by 2.5 per cent in the same period of the previous fiscal year. The current account registered a deficit of Rs 5.43 billion due to the widening trade deficit. The current account deficit amounted to Rs 2.32 billion in the same period of the previous fiscal year. Similarly, the overall balance of payments (BoP) resulted in a deficit of Rs 3.29 billion compared to a deficit of Rs 2.11 billion in the same period of the previous fiscal year.
The central bank also revealed that Nepal received capital transfer amounting to Rs 674.7 million and foreign direct investment (FDI) inflows of Rs 4.61 billion. In the same period of the previous year, capital transfer and FDI inflows were Rs 606 million and Rs 1.23 billion, respectively.